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The FACTA Disposal Rule and Its Impact on Your Business

The Fair and Accurate Credit Transactions Act (FACTA) was enacted in 2003 to protect the privacy rights of consumers. Key provisions include:

  • fraud alerts placed on consumer files suspected of being compromised,
  • truncation of debit and credit card numbers on receipts, and
  • the Red Flags Rule (which outlines how businesses must implement identity theft programs).

What Is the Disposal Rule?

While FACTA is almost 10 years old, the latest provision – the Disposal Rule – was put into place in 2005 to specifically address how individuals and businesses dispose of sensitive information derived from consumer reports. Organizations affected include, but are not limited to, the following:

  • mortgage brokers,
  • car dealers,
  • insurance agencies,
  • government agencies, and
  • landlords.

Additionally, any employer that utilizes credit reports as part of the hiring process must protect – and properly dispose of – consumer information. Essentially, most businesses and organizations are affected by the Disposal Rule. While there are no specifics in the rule regarding how businesses should dispose information beyond “reasonable measures,” it’s worth examining the processes you currently use to protect and get rid of client information.

Examining Your Current Disposal Processes

Many organizations invest in paper-shredding machines to destroy confidential documents. While this may seem like an easily-implemented and economical solution, more often than not, it does not represent a consistent and efficient method for disposing of sensitive records and materials. One of the main problems with this option is that it requires a considerable investment in time.

Most machines can only handle a handful of documents at a time. Even then, staples, paper clips, rubber bands, and sticky notes need to be removed in order to prevent costly jamming mishaps. Though you and your employees take caution to all of these hazards, shredders frequently jam and malfunction, slowing down your workday and allowing potentially sensitive files not to receive the proper methods of disposal they require. Because the process of maintaining these fault-heavy machines can cut into your productivity and be frustrating to employees, as a result, your staff may attempt to forgo these headaches altogether by disposing of private information in trash receptacles.

Improper disposal methods such as these accounts for the majority of data breach incidences. For example, in 2012 a large infringement was noted when patient records were found in a dumpster in Virginia. As a result, it’s important to have a secure, consistent, and reliable solution for destroying documents and files.

The Benefits of a Professional Shredding Solution

  • off-site shredding,
  • on-site shredding,
  • drop-off shredding,
  • one-time purges,
  • shred collection containers, and
  • media and hard drive destruction.

No matter the option best suited to your business requirements, you should always be provided with a Certificate of Destruction subsequent to the shredding process.

Records Management Center provides businesses throughout Augusta, Evans, Thomson, and Martinez, GA; and Aiken, SC; as well as the Central Savannah River Area, with professional-shredding and information-destruction solutions. To find out how we can help your business, please contact us by phone or fill in the form on the page.